Loan to for pay the wedding???

Please, do not take out a loan to pay for your wedding. And definitely don't use the money your guests give you as a gift to pay off a loan. This "friend" of yours is financially irresponsible and you should not listen to her.

We are saving for our wedding. We are paying all our vendors with a credit card for the points which we'll use to pay for our honeymoon.

You shouldn't deplete your savings account but you definitely should not take out a loan. You need to plan for the wedding you can afford. Going into debt for a party is ridiculous. And counting on monetary gifts to pay it off is also a bad idea because you might not get nearly enough money and your guests are not gifting you money to help pay for the wedding they are gifting you money for your honeymoon or to start your life together. I personally would rather the down payment on a house, but that's just me.

Do not do a loan. I can promise you that your wedding will cost more than the gifts you get. Set up a savings plan and follow it. Loans collect interest and cost more in the long run. I put money in a secondary savings account every paycheck to pay for our wedding, I also deposited tax refunds and any extra cash along the way ( music survey 3 hrs =$100). Your friend is not very smart when it comes to finances. IF you want to buy a home, set aside money for that and scale down the wedding plans. More guests =more $$$ to be paid out.

NO NO NO!!!! You don't want to start your married life in debt. If you have to postpone for a little bit so you can pay cash for everything. or go small have a JOP wedding and a small party.

Your friend is giving you very bad financial advice. Loans have interest. Pay as you go and plan a wedding you can afford. Never pay interest on anything, ever.

No on all counts. And don't listen to this friend for advice on, well, anything, lol...

The loan will cost way more, interest percentage wise, that you'll make on the interest on the savings account.

You have a year and a half. Save what you can, and do the wedding you can afford.

Yeah, that advice is not good. You should use your savings and then, since that is your train of thought, replenish your savings with monetary gifts. You might not get much at all - I only got 1/6 of what I paid for the wedding, and had I had a loan, then I would have to spend more time (and interest) paying it off.

Have the wedding you can afford, and then have a blast doing it.

If you don't want to use all of your savings then use a select portion then use a loan to pay for the other part if you feel more comfortable doing that. No one here is going to give you the best advice when it comes to a situation like this. My fiancé and I are saving as much as we can before the wedding and if need be we'll use some of our 401 or a loan to pay off the rest of the wedding. Some people can't afford to save a lot of money nor do they want to down size or put off their wedding until they have a certain amount saved up. Do what you and your fiancé are comfortable with and have a great time! :-)

^This is horrible advice. Borrowing from your 401k to pay for a party is ridiculous. I'm sorry if you take offense to that, but it's true. And being comfortable with doing it does not mean it's a good idea. Plan the wedding you can afford. It's a freakin party, A PARTY. it is not worth going in debt and taking out a loan for.

Don't borrow from your 401K; it's not worth 'having a great time', and there are usually penalties too.

THAT Beth, is the bad advice.

Your friend is an idiot.

@Beth, telling someone to borrow from their retirement to pay for a wedding IS bad advice. Us telling her to pay for the wedding she can afford is excellent advice. If someone can't afford to save for the wedding they want, then they should either A) Downsize the wedding or B) Extend the engagement.

@Beth, please don't give financial advice to anyone.

Let me see, borrow from 401K, pay penalties out the wazoo and then get nailed on your taxes to have a party? EFF that. Have a wedding you can afford, cut the guest list if needed. Borrowing from a 401K for a wedding is a dumber idea than the loan.

A lot of people will disagree with me, but I don't see a problem with taking out a loan to pay for a wedding. However, do not count on gifts from guests to pay it off - if you take out a loan expecting $x dollars from guests, you will screw yourself because there's no way you can guarantee or count on a certain amount of money in gifts. The advice to borrow from your retirement is BAD advice.

Ok wait. Some 401k plans allow for loans where you pay yourself back with interest with no tax penalties. IF a person has a stable job and is willing to risk getting screwed if the job goes poof, then that is better (as in a lesser evil) than a loan with interest.

But no loan -- 401k or not -- is a better option than paying as you go. If you can't pay cash, you can not afford it. Period.

Scale back your tastes or you will never have money.

@annakay511, the problem is the interest you have to pay. Let's say they decide that they're going to borrow $25,000. With interest, they'll repay between $2,500 - $3,000 back (the bank is a for profit business, so they will profit from the loan) depending on the terms of the loan. Additionally, they will have another bill that will need to be paid monthly. God forbid they miss a payment or for whatever reason are unable to repay the loan, now they have an impending bankruptcy. And with the bankruptcy laws changing, I highly doubt the court will allow them to include the loan used to pay for a wedding in a chapter 7 bankruptcy. The court could reject their chapter 7 and force them to file chapter 13 which will only reorganize their bills, but they will still need to repay the loan. All because they refused to downsize or save and plan for the wedding they can afford.

Only use the loan as a backup!! Not the first choice. We didn't get nearly as much cash as expected, so I wouldn't rely on that either

There is no party, not even a wedding, that is worth going into debt for.

@LivelyBride, that's true, you can borrow and not receive tax penalties. However, the amount borrowed cannot increase your annual income and push you to a higher tax bracket. If that happens, penalties will apply. Borrowing from your 410k is never a less of two evils. You are saving that money for a reason. And a wedding is not the reason. They need to scale back or extend the engagement.

Definitely no to the loan. We are using some of our savings to pay for the wedding, most is just what we're saving from our paychecks. But we also aren't planning to buy a house any time soon and we don't plan to have kids any time soon because of our careers. So that's why we're okay going into our savings. But you'll just have to evaluate which is more important to you, a big wedding or a downpayment for a house. Most people would choose house, but if you're fine working on building up savings for another few years for the house to have the wedding you dreamed of that's great. But don't go for a loan. Plus like others said, you may not get that much gift money.